Should social security be considered when planning for retirement?

Thanks, brother.

I agree. I eat 2 Greek yogurts per day which costs $700 per year. I eat a decent amount of nuts, probably another $700 per year so that is $1400 just for those 2 things.

Why would you need to defer your pension date? Does it continue to grow after you leave your job? Mine doesn't so it is now my first source of monthly funds. Second is withdrawals from IRA's and so far I have deferred taking Social Security. Almost 67 and am just letting the monthly SS amount grow as my wife is still working so my SS monthly check would be taxable. Looks like we can live on 65-70% of our previous household earnings when I was working. Analysis says I have a greater than 95% chance of croaking with more money in my IRA at age 90 than I started with at 65 when I retired. And I consider SS check to be the 3 leg of my stool.

I retired at 60 and did not plan on SS. I assumed it would be there in some form but since we cannot predict what will happen 20 years from now, you should plan on not collecting it and then when you do it will be a nice bonus or inflation hedge.

The SS projections may seem realistic but you need to remember that they assume your continued employment with your wages at the same level/percent of SS maximum taxable wage. Are you sure you will not take a pay-cut, have a wage freeze or be laid of for an extended period which would reduce your SS benefit?

Since SS calculates the benefit based upon your top 35 years of indexed wages, by retiring at 60, your top 35 years may not be what the projections assume today. The same is probably true with your company pension. If your company has a wage freeze or you are laid off and are re-employed at a lower salary, you may not get what you are assuming. It sounds like you are planning on doing what I am doing, which is delaying SS until at least 67. You want to have enough saved so that the earnings on those investments (plus any pension) comes to to covering (or fully covers) your expenses. Then when you start collecting SS, you can easily handle expenses and surprises. One thing may people fall to realize is that medical insurance could be more expensive without an employer subsidy. Also, it is a good problem to have but some people spend more in retirement instead of the typical assumption of about 75% of pre-retirement income. If you are healthy, it is easier to spend more money when you have more free time to shop/travel/spend.

Oh Please wrote:

I'd be down for a retirement visa, but no idea how healthcare would work in that case. For various reasons, we aren't leaving our kids any money when we die, so the plan is to figure out how to be close to zero money by time we die. Admittedly hard to figure out. Anything that is left goes to animal rescue.

You’d be surprised at the high quality/affordable healthcare available in many countries. I used to live in Korea and even when I wasn’t living there later I scheduled a root canal back in Seoul since I just trusted the quality of care more and it was considerably cheaper. I ended up living there again more recently and my various healthcare experiences were overall way better than you could expect in the US. Places like Thailand offer retirement visas, you just have to have a modest bank account balance and it’s pretty much automatic; despite it being more of a developing country they have pretty good care and just a fraction of what you’d pay in the US. I don’t remember paying much ever out of pocket in Asia/Europe like the deductibles you might have in the states (international insurance plans through my employers, and when I’ve gotten my personal international insurance for traveling/between jobs it’s been significantly cheaper than standard coverage in the US). I wouldn’t go to somewhere like Cambodia or Ecuador for a major procedure, but there are countries with quality at or above the level of the US and at a much lower price.

Naperville Runner wrote:

Thanks correctamundo! I also live in Chicago area. We spend a crazy amount of money on groceries - 3 of us at home and struggling to get it down to $1,000/month. How can you possibly get by on $2,000/year. We also cut the cable cord and I'm wondering why I waited as the bill went from $225/month down to $50 and we had a ton of streaming services we'd already been paying for. Any advice you can give on groceries/food would be appreciated

There’s one of me vs three of you. So the comp is $2k for me vs $4k for each of you, or about 50% efficiency

I typically do 2 meals a day, either a late breakfast or early lunch, and dinner. The local grocery store I go to has much lower prices than the major grocery chains. It’s not unusual for a pound of chicken to cost less than $1. Boneless skinless is more expensive but still less than $2 per lb. (the major grocery store prices for chicken are $3 or more per lb). Pork is usually in the $2.50 range. I don’t buy beef mainly because I don’t like red meat, but it tends to be expensive.

Veggies (broccoli, cauliflower, peppers, asparagus) run less than $1.50 per pound)

I eat in most every day, and prepare my own meals. Lots of time to do so, and I enjoy cooking. Very little goes to waste, as I am anal about not wasting food.

Yeah, xfinity had me up to 225 per month also, which was ridiculous

You might want to check on whether your pension grows. I left my long term employer recently and they provided me my annual pension amount and I asked them whether it would change if I waited from 60 to 63 or 65. The answer was yes - it would go from $48K/year up to $60K/year. Maybe different pension plans are different but I think many of them work like Social Security

Thanks! We still have a lot of work to drive down our grocery bill without our diet suffering

Don't include it on what you need wrote:

I'd say don't rely on it, make it such that you can be fine without the social security. But if you do have the social security, you just live a bit more comfortable and can spend more. Average monthly social security payment right now is $1500 per month. So plan on potentially not having that full amount, and if you do then you can travel a lot more and do extra things that you otherwise wouldn't.

Its really not that much money, so it won't make a big difference either way.

stan the corgi wrote:

Yes, you will realize an 8% increase if you wait 3 years or so until 70, BUT you will also LOSE 36 months worth of payments which could add up to over 100k. How long would it take to make that up?

I've calculated this a few times. If I take SS at my full retirement age of 66.5 I'll get something like 2300 a month. If I wait until 70, the monthly payment will be higher, but the break-even point is about age 85 to make up what I would get in the 3.5 years before 70. Screw that.

Social security is the biggest ponzi scheme in US history. You're not actually saving for retirement, FDR just convinced dumb americans that they were in an effort to tax people more. Think I am lying? Try telling the Feds thanks but no thanks and that you would rather save the money yourself, see how that turns out.